Peter Smith, CEO of leading cryptocurrency exchange and wallet provider Blockchain.com, has warned that more cryptocurrency destruction is coming in the short term, but believes that in the long term, this type of destruction will lead to a stronger industry.
Cryptocurrency prices have recently seen increased volatility following the collapse of the Terra ecosystem, which saw LUNA plunge from a top crypto-asset to nearly worthless, and due to factors affecting markets stock markets, including inflation and an impending recession.
For Smith, more pain comes in the cryptocurrency space, but crypto investors should take it as a lesson that it is important to average the dollar cost in their positions to avoid increased exposure to sudden bouts of volatility.
Speaking to CNBC, the crypto CEO suggested that investors should be prepared to hold their assets for a while as the industry matures. Smith said:
And you have to be prepared to hold it for a while. Because we are still in the nascent period of building this whole financial system.
Smith added that the market is undergoing a “risk and leverage elimination throughout the global market system” which has also affected the cryptocurrency space. In his words, however, a “long process of adoption and growth” is still in sight for the crypto industry.
In the short term, however, he sees more destruction to come as weaker projects in space fall out of favor. According to Smith, we need to “see consolidation in the market itself as well as in the companies that serve the market.” In the long run, he recently suggested, “creative destruction” makes an industry stronger.
The CEO added that he expects in the coming weeks “risks will begin to be exposed across the economy”, including for companies, trading companies and funds that have not managed properly. their risks.
Nonetheless, he remained a cryptocurrency bull saying he’s been through four or five similar market cycles, and noting that “each time it’s been a brutal pain along the way but led to an industry stronger, and a more useful industry, and real growth fundamentals over the next two to three years.
Recently, co-founder of cryptocurrency trading and venture capital firm Three Arrows Capital, Su Zhu, revealed that he was seeing signs that Bitcoin ($BTC) was re-entering an accumulation range after the fall. of the cryptocurrency price for seven consecutive weeks for the first time in its history.
The cryptocurrency hedge fund co-founder also added that Bitcoin had shown strength against stocks, at a time when analysts at Bank of America noted that the flagship cryptocurrency had failed as a hedge. against inflation on its correlation with equities.
The views and opinions expressed by the author, or anyone mentioned in this article, are for informational purposes only and do not constitute financial, investment or other advice. Investing in or trading crypto-assets involves the risk of financial loss.
Featured image via Pixabay
#Blockchaincom #CEO #Warns #Imminent #Crypto #Destruction #Lead #Stronger #Industry